Large Business

Several parts of the Affordable Care Act affect big businesses. There are important provisions related to tax credits and reporting, early retiree coverage, grandfathering rules, and more. See the questions and answers below for more information.

• What is considered a large business?
• What insurance coverage is exempt from the law?
• Do I have to provide health insurance to my employees?
• How does the law affect tax policies?
• Can I get financial help for providing health insurance to early retirees?
• Can I provide financial help to employees who contribute to their health insurance premiums?
• Do I have to report the cost of insurance in my employees’ W-2 forms?

What is considered a large business?

You are generally considered a large business if you have more than 50 employees.

What insurance coverage is exempt from the law?

Job-based coverage that was in effect on March 23, 2010 is exempted from certain provisions in the law. Learn more about “grandfathered” health plans.

Do I have to provide health insurance to my employees?

The law does not require employers to provide health insurance.

Starting in 2014, large businesses (those with 50 or more full-time workers) that do not provide adequate health insurance will be required to pay an assessment if their employees receive premium tax credits to buy their own insurance. These assessments will offset part of the cost of these tax credits. The assessment for a large employer that does not offer coverage will be $2,000 per full-time employee beyond the company's first 30 workers.

 The Department of Health and Human Services estimates that fewer than 2% of large American employers will have to pay these assessments. 

To learn more read the Employer Bulletin on Automatic Enrollment, Employer Responsibility, and Waiting Periods.

How does the law affect tax policies?

Visit the IRS website to learn more about taxes and the Affordable Care Act.

Can I get financial help for providing health insurance to early retirees?

Yes. Employer-based plans that provide health insurance to retirees ages 55-64 can now get financial help paying for high-cost early retirees through the Early Retiree Reinsurance Program. This program is designed to lower the cost of premiums for all employees and reduce employer health costs. 

Can I provide financial help to employees who contribute to their health insurance premiums?

For lower-income employees who spend between 8% and 9.8% of their income on premiums, large employers can provide the employees vouchers equal to the amount of the employer’s premium contribution. This allows the employee to get financial help buying insurance in the Affordable Insurance Exchanges at no additional cost to the employer. This means that previously uninsured low-income workers will gain coverage and their employers will harvest the improved productivity that goes with it.

Do I have to report the cost of insurance in my employees’ W-2 forms?

Employers do not have to report the cost of insurance on employee W-2s in 2011. This reporting is optional in 2011.

The reporting requirement is intended to be informational and provide employees with greater transparency into health care costs. The amounts reported are not taxable.

Learn more about the W-2 reporting deferral from the IRS.